dataxu's thoughts on data, analytics and the industry

On Mobile, Real Time Bidding Does Not Equal Cookie Buying

Real-time bidding has indeed arrived for mobile—and in a big way. It’s no surprise as there has typically been a low fill rate on mobile ad inventory, and real-time exchange-trading has proven itself to be massively effective for advertisers under such market conditions. The only real surprise is to those entrenched in the mobile-specific advertising world that have been asleep at the helm. They are losing ground to the traditional display folks who are now offering a LOT of mobile inventory.

Sure, there are still the messy technical problems that led to the current landscape of specialists: carrier politics, a plethora of devices, lack of cookies, no 3rd party audience data. But this is actually great news for those who have developed technology in the RTB era, and do not rely solely on audience targeting strategies to drive performance. We’re seeing promising evidence already that performance based optimization strategies yield better scale and cost-per-engagement than the conventional inventory sources like mobile-specific ad networks, and premium direct buys.

People often conflate real-time bidding (RTB) with buying cookie lists and targeting them, but they are very distinct concepts—not co-dependent ones. I think this is because many first generation exchange buying platforms are really just re-purposed ad networks, turned into cookie buying platforms that just happen to buy the media in real-time. They can’t scale beyond rules-based cookie bidding strategies. Mobile’s muddled technical limitations will draw a stark distinction in real-time buying strategies. Without extensive 3rd party cookie lists, what can the cookie buyer to do with RTB for mobile? Not much. Vendors that have perfected more flexible media buying strategies are perfectly positioned to take advantage of the wave of mobile inventory that is already coming online through the exchanges.